The VIX has decoupled from the averages.
The Russell Index is lower four days in a row, its longest streak in three months.
The S&P Index has declined over the last four trading days for the first time since November.
Strength in transports, heralded by the bulls as recently as last week, is also rolling over.
The S&P Index has had its first back-to-back loss in five trading weeks.
The Nasdaq is lower over the last trading week.
The Russell Index is underperforming the senior averages and testing key technical support.
Emerging markets began to roll over a week ago. The Stoxx 600 is on pace for its fifth consecutive decline and the ninth drop in the last 11 days.
Dr. Copper is falling under the weight of slowing growth and rising inventories.
The high-yield bond market is beginning to show topping signposts, with iShares iBoxx High Yield Corporate Bond ETF(HYG) down $0.57 and SPDR Barclays High Yield Bond ETF(JNK) down $0.22 yesterday.
Taxable bonds are making new lows. The 10-year U.S. note yield has risen for eight days in a row -- the longest streak in five years. Sovereign bond yields in Europe are following suit. With both stocks and bonds moving in the same direction (lower), risk-parity quant funds are getting hit. Remember my thesis -- buyers live higher and sellers live lower; this could exaggerate a decline.
Bottom Line
I believe we rapidly are approaching a market correction of some consequence.
As Jim "El Capitan" Cramer references in his opening missive, I expect a correction and not a catastrophe.